RATING: POLITE APPLAUSE

MULHOLLAND DRIVE: Starring
Naomi Watts
,
Laura Elena Harring
,
Justin Theroux
and
Ann Miller
. Directed and written by
David Lynch
. (R. 146 minutes. At Bay Area theaters.)
Souls are plundered, identities robbed and reality deep-sixed in "Mulholland Drive," the newest fantasia from David Lynch. Proceed without prejudice and surrender all notions of what movies are supposed to give us: We're about to enter Planet Lynch.

A wacked-out parable about contemporary Hollywood and the psychological toll it extracts from the young and innocent, "Mulholland Drive" is exhilarating not only for its dreamlike images and fierce, frequently reckless imagination but also for the fact that it got made (and released) at all.

Originally a TV-series pilot -- ABC hated it, found it too dark and creepy - - "Mulholland Drive" was rescued by two producers and the French company Studio Canal, who doubled the original $7 million budget, allowing Lynch to shoot a new ending and supporting material.

Borrowing themes of identity and memory that he explored in "Twin Peaks" and "Lost Highway," Lynch fashions "Mulholland Drive" as a two-tier narrative featuring the same actors, but in different roles and seemingly separate universes. It's weird, it's impenetrable, but there's a mesmerizing quality to its languid pace, its sense of foreboding and its lost-in-time atmosphere -- and no lack of wiggy Lynchian humor.

In the first half, Betty (Naomi Watts), a perky young blonde from Deep River, Ontario, arrives in Los Angeles -- "I'm in this dream place!" she gushes -- to start her acting career. A beautiful amnesia victim (Laura Elena Harring) enters her life, an aging landlady (Ann Miller) takes Betty under her wing, and in a separate plot we meet a cocky filmmaker (Justin Theroux) who's being pressured by syndicate thugs to cast an unwanted actress in his next picture.

The amnesia victim calls herself Rita after seeing a poster for "Gilda" with Rita Hayworth and, spurred by frisky Betty, sets out to learn her true identity. There's a dwarf, a hot moment of lesbian sex, a spooky clairvoyant neighbor (Lee Grant) and a magic blue box that, once opened with a key, sends our heroines tumbling like Alice though the looking glass to another world.

In the second half, Betty is gone and replaced by Diane, a burned-out lesbian obsessed with the beautiful Camilla (Harring). Some of the same characters reappear, but their relationship to Diane and Camilla is vague. Is the second half Betty's nightmare, or is the first half Diane's wish- fulfilling dream? Is neither one real?

Lynch is so deliberate in the effects he creates that it's probably no accident that his two actresses give such melodramatic, campy performances -- as if he wanted to achieve the zoned-out fragility of a film noir femme fatale or the dame in a Sam Fuller potboiler.

Watts eventually proves herself a far more knowing actress than she first appears, particularly when her first character, Betty, goes to an audition and nails the part by pouring on the sex with her co-star, an overtanned has-been (Chad Everett). Harring, on the other hand, has the dimension and animation of a comic-strip voluptuary. With her over-lacquered looks and vague expression, she's like a refugee from "Showgirls."

"Mulholland Drive" isn't on the same level with "Blue Velvet," Lynch's greatest film and the one that still defines his career. But it shares that film's audacity and vigor, and it holds us, spellbound and amused, for all of its loony and luscious, exasperating 146 minutes.

Can it ever be explained? Probably not. Just as "Memento" did earlier this year, "Mulholland Drive" will generate debate, confusion, myriad theories and repeat viewings. That may not be a measure of greatness, but it proves that Lynch is in solid form -- and still an expert at pricking our nerves.